THE MAXOL GROUP - A Proud Heritage
The Maxol brand is one of the most familiar and recognised brands in Ireland thanks to a network of 214 distinctive blue and yellow branded service stations and 37 oil distributors with their fleets of blue and yellow coloured vehicles. Although the Maxol name itself was only introduced in 1972, the company has a long and interesting history dating back to the start of the career of its founder William G. McMullan in 1916. Maxol is proud of the fact that today it has a service station and distributor in nearly every county in Ireland.

The company, which is Ireland's oldest and foremost independent oil company is entirely Irish owned and is one of the largest family-owned concerns in the country. The Maxol Group is part of McMullan Bros. Limited and encompasses Maxol Limited and Maxol Lubricants Limited in the Republic of Ireland. In Northern Ireland the company comprises of Maxol Oil Limited and Maxol Direct (NI) Limited. The group markets a comprehensive range of oil and petroleum products to all sectors of the Irish market through its different business divisions: service stations, commercial, home heating oil and Lubricants. The group, which was incorporated in 1920, has grown considerably in recent years, both organically and through a number of strategic bolt-on acquisitions, and today has a turnover in excess of €700m.

The company is run by an experienced management team which collectively has over 80 years experience in the petrol retailing industry and is spearheaded by Tom Noonan, Maxol's chief executive. Responsibility for the retail division lies with Brian Donaldson, Maxol's general manager, marketing and retail.

Brian Donaldson, says: "The retail fuels market in Ireland has changed dramatically over the last couple of years. We have seen most of the multi-national brands disappear via withdrawal strategies, and in turn, new brands and entrants into the marketplace have been created. Maxol's retail business model is simple. We own and develop service stations which are then licensed to an independent party to operate. There are now 214 service stations in the Maxol Group retail network, of which 92 are directly owned and operated through License Agreements, while the remaining 122 stations are privately owned and operated by independent retailers, who purchase and retail all of their fuel under the Maxol brand.

"Maxol's role is to work with all our licensees to ensure that the full potential of each location is achieved. As a starting point we prepare and agree a detailed business plan for each site, which covers financial projections and is supported with a full sales and marketing plan. Under the business plan, we set targets for the different sections of the business including fuel, shop sales, car wash and other revenue streams such as coffee, payment of utility bills, phone top-ups etc. Critical to any plan is the potential to make a profit which has involved the company investing in a robust POS and back office system. We also provide assistance and give benchmarking data on average overheads and margins for comparative service stations. Stations performing below the norm are easily identified and so corrective action can be taken quickly.

One big project the company has been involved in during 2009 has been an investment in providing an integrated credit and fuel card solution for Maxol's company owned network. The benefits include faster speed of transaction at the counter for paying customers and enhanced controls for licensees. In tandem with this Maxol has established a dedicated communications network operating on broadband which is independently managed by a third party IT provider. 75 company sites now operate on the system. The project was led by Maxol's retail manager, Des Duffy. He says: "This was a challenging project which took 12 months to fully roll out. It has involved a wide cross section of personnel from within the group covering IT, retail, finance and property to manage the implementation process. The benefits of faster transaction time have been well received by our customers. We are not stopping there and the next stage will be to develop a more comprehensive suite of management reports from the data that is now available online 24/7."

Maxol also works with stations to develop sales and marketing plans. Brian continues: "The company provides support in the form of national and local activity and we generally run eight promotions to drive fuel sales each year, offering quality gifts or household items at a dramatically reduced price when fuel is purchased. The most successful have been a range of AA endorsed travel related products. Customer loyalty promotions are also run on coffee and car washes, providing a free coffee or wash when a fourth is purchased. In this way, we can keep our sales volume high by giving customers incentives to return to Maxol. We back these promotions up with point of sale displays that advertise offers and these are refreshed continually to keep the customer interested."
Innovative Promotional Activity
In the Republic of Ireland, Maxol has recently linked up with the Irish grocery retailer Superquinn to offer a value for money promotion which has already met with huge success. Following an initial three week trial at Superquinn stores in Lucan and Ballinteer in Dublin, the promotion offers five cents off Maxol fuel at selected service stations within close proximity to each store. Following the trial, the promotion has been extended to customers of all 23 Superquinn stores across Ireland. Customers spending €40 or more at Superquinn stores in Dublin, Carlow, Kildare, Laois, Wicklow, Kilkenny, Waterford and Limerick receive a motor-fuel voucher on their grocery receipt entitling them to five cents per litre off the pump price of petrol and diesel, up to a maximum of 50 litres. Vouchers can be redeemed at over 40 selected participating Maxol service stations in the Republic of Ireland.

Speaking about the promotion, Brian Donaldson says: "We are delighted to have linked up with another Irish-owned company such as Superquinn to offer motorists added value at the pumps. Maxol is constantly striving to offer its customers promotions with a difference and with this unique offer we feel that we are again giving customers some real added value."

Paul Doggett, category manager, Superquinn, reiterates Brian's sentiments: "It is another opportunity for Superquinn customers to avail of great value, this time on petrol at Maxol when they shop at Superquinn stores. It's just one of the ways that customers can save money with us. We expected it to be very well received by our shoppers and it was."

The promotion is just one of the projects that Fergal Harrington, brand development manager for Maxol has been working on during the past year with Donaldson. He says: "Maxol is supporting the promotion by investing in radio and outdoor advertising along with press to communicate the offer and it has proven highly effective in driving customers into Superquinn and subsequently to Maxol. The popularity of the offer has exceeded our initial expectations. Our extensive network has given us the advantage of having Maxol stations in areas close to Superquinn stores. It allows us to reach a large number of customers and support the business with these types of dynamic promotions."

These types of promotions are key to driving customers into Maxol's network of service stations but both Noonan and Donaldson have an acute understanding that first the product has to be right and that's where Maxol's strategic alliances with its symbol stores, which operate shops on its forecourts, come into play.

Symbol Partners - MACE and SPAR
In 2007 Maxol entered into a five year long contract agreement with the wholesaler BWG Foods, which operates the MACE and SPAR symbol franchises in the Republic of Ireland. An exclusive forecourt partnership agreement, the deal is valued at €400 million, equating to €80 million per year in retail turnover. The contract follows on from a successful 10 year partnership between the brands and has lead to a network of some 44 Maxol/Mace and five Maxol/SPAR forecourt convenience stores. Plans are currently in place to increase this by the addition of a further 15 Mace stores to the network by 2012.

Brian Donaldson explains the rationale: "As consumers adjust to lower disposable incomes there is a greater need to deliver real value for money on an extended range of convenience lines. Much work has already been done in this area by extending the range of MACE and SPAR own label products and by sourcing products directly from the manufacturer which allows higher value promotions to be introduced on core essential lines."

In contrast to this, in Northern Ireland, the company has moved all its stores from MACE to SPAR, which is owned by the Henderson Group. The £200 million, five year deal involved 29 Maxol convenience stores being branded as SPAR outlets and means that all of Maxol's company owned service stations in Northern Ireland now operate under the SPAR brand. The move followed the company's earlier trial of the SPAR franchise at ten Maxol sites in late 2005 and now ensures a consistent visual identity, service and range of grocery goods for all Maxol customers in the province.

Commenting on the deal Brian Donaldson, says: "We took the bold decision to brand all of our convenience stores under one common brand serviced by one wholesaler and aim to have all of the re-branding and re-imaging work complete in time for 2010. This involves an investment of £600,000 in converting 18 stores to SPAR and is a bold move in the present economic climate but one which we believe will yield a better return on our investment, better profitability and a better deal for our customers."

As part of the deal Maxol is providing petroleum fuels to 13 service stations owned by the Henderson Group, which are in the process of being branded with the distinctive Maxol blue and yellow forecourt image. Brian Donaldson continues: "The deal will consolidate Maxol's position as the undisputed market leader in the petrol retailing market in Northern Ireland and will lay down a strong platform for the future growth of our business. Both Maxol and the Henderson Group are locally owned family run businesses, which, despite the economic downturn, have continued to invest in their business, and both share a commitment to provide the highest standards of customer care. SPAR has an established reputation for value and an extensive portfolio of convenience products which, importantly, from our customers' point of view, means we can expand the range of products we provide them."

Henderson Wholesale's sales and marketing director, Paddy Doody, is also delighted with the deal, he says: "It is excellent news for our business and allows us to expand our portfolio of SPAR stores throughout the province alongside our fuel partner Maxol. The combination of two strong brands, SPAR and Maxol will result in a first-class convenience store and petrol forecourt solution for the consumer. SPAR is delighted to be working with Maxol on this extended alliance which will bring all the benefits of the SPAR brand to these new sites."

Strategy For Growth
Strong alliances, however, are only one block in the building of Maxol's business on the island of Ireland and over the past 20 years, Maxol has continued to invest heavily in strengthening its retail business.

In the Republic, Maxol's planned programme to develop high-quality service stations has witnessed the company making an investment of over €80 million in the period between 1996 to 2009. The foundations for this investment started back in 1996 when Maxol acquired 80 sites from Statoil, of which 30 were company owned service stations. In addition, Maxol has continued to identify and purchase independently owned sites for inclusion in its company owned network. This strategy has enabled the company to introduce five new sites to its network during the past three years.

In 2005, Maxol moved its focus to the Northern Ireland market and acquired 13 Esso company-owned service stations as part of an all-Ireland development strategy. Following the acquisitions it immediately announced a £5m modernisation programme for these new sites which would enable Maxol to maximise the potential at each location. Today six major redevelopments have been completed at these former Esso sites including Rosepark in East Belfast, Townparks in Co. Antrim, Braid River in Co. Antrim, Downpatrick in Co. Down and Fortwilliam in Belfast. And one further development at Kinnegar in Co. Down is set to be complete by May 2010.

Revolutionary Design at Adamstown
Maxol has been making significant investments south of the border too and in 2009 Maxol unveiled a new state-of-the-art service station in Lucan in the Republic of Ireland. The station represents an investment of over €1.6 million by Maxol and has enabled the company to totally refurbish the site and create 20 new jobs in the area. The new revolutionary forecourt boasts a 150m2 convenience store housed within a strikingly modern glass fronted and curved roofed building and is the first development of its type by Maxol in the Republic.

The new energy efficient state-of-the-art forecourt, which is modern in the extreme, perhaps is an indication of what all forecourts will be like in the future. At the site, Maxol's forecourt is detached from the convenience store giving a distinctive identity with Maxol's Maxwash centre and external cash machine located front and centre. The new Mace store has an extensive hot and cold food offering which includes a fresh pizza counter, full delicatessen and a new Bewley's hot beverages station. The store has also been designed with a new comfortable seating area for customers to relax and enjoy anything from a hot lunch to a cup of coffee. Outside, the extensive forecourt boasts ample parking for those who wish to spend extended time shopping in the Mace store.
Tom Noonan says: "Despite the gloomy economic outlook we have remained confident in proceeding with the development of this new addition to our company-owned network. The service station is the first of its kind in the Republic of Ireland and incorporates our new forecourt building design that will be the template for all future Maxol service station developments around the country."

Maxol's chief executive also believes that the location of the new service station will help it to prosper and allow it to play an important part in the growth of the Lucan area: "The new station will service the growing population within Lucan and we expect it to perform very well in the future. While a great deal of investment and development has slowed in the area, hopefully the investment by Maxol of €1.6 million will generate renewed confidence and contribute to developing a sustainable urban community in the town."

Willie O'Byrne, managing director of Mace echoes these sentiments: "The development represents the next phase in Maxol and Mace's forecourt retail partnership which is now in its twelfth year. There are now 44 Mace convenience stores on Maxol company-owned forecourts in addition to the many Maxol/Mace branded partnerships within the independent petrol retail sector. Maxol's investment in Lucan confirms the increasingly significant part forecourt retailing is playing in the convenience sector and puts in place another important facility for both the new town and the wider community."

Not a company to rest on its laurels, Maxol is following this development with another major project in Clonakilty in Co. Cork. A much bigger development involving a 200 metre convenience store, the design is identical to Lucan, and again, will include an investment in energy efficient building materials and in-store refrigeration equipment thereby requiring less heating and contributing to reducing energy costs. A further feature of the design is that all internal walls are stud so that they can be altered or extended in the future without major disruption or costs to the building. The design and construction is slightly more expensive but both Brian and Tom believe that over a five year period the company will reap the benefits through reduced operating costs and fuel bills.

Maxol's forecourts have always been at the forefront of the industry and the company has won numerous awards along the way, the most recent to win an industry award being its service station in Co. Antrim, which picked up Best Main Route Service Station in the UK in Forecourt Trader magazine in 2009.

Growth of Biofuels
Innovation definitely lies at the heart of the company, however it's clear to see that this is not restricted to Maxol service stations and its marketing activity. Maxol is also well known for pioneering green fuels, and in 2005 in conjunction with Ford Ireland, announced the launch of Ireland's first bio-ethanol car, the Ford Focus FFV, and the opening of Maxol's first
bio-ethanol fuelling pump in Dublin.

Outside of Sweden, Ireland became the first European country to have an E85 fuel pump in place and available to the motorist. It was another first for Maxol and the company began rolling out this new grade of fuel across many of its other stations. Today the fuel is available in 30 of Maxol's service stations and is proof of Maxol's continued commitment to providing customers with environmentally friendly fuels. Bio-ethanol provides an overall saving in CO2 emissions of up to 70% when compared to the petrol equivalent. Maxol's bio-ethanol is manufactured from whey, which is a milk derivative sourced locally in Ireland from the Carbery Group and doesn't conflict with the food for fuel debate. The success of E85 was assisted from the outset by the Irish Government which provided derogation on duty tax on bio-fuel products, something that it has committed to until 2010. This proved effective in kick starting the country's programme towards meeting EU Directives in relation to bio-fuel consumption targets.

In August 2007, Maxol was to replace its regular unleaded petrol with its new E5 fuel - a blend of regular petrol and up to 5% locally produced bio-ethanol. The result was, that, for the first time throughout Ireland, drivers of standard petrol powered vehicles were able to use a bio-fuel without risk to the car manufacturer's warranty. The rollout of the E5 green fuel was another first for Maxol in the Irish fuels market and followed on from the launch of its E85 fuel (85% bio-ethanol) in September 2006. It is also further evidence of Maxol's commitment to renewable fuels.
Much has changed on foot of the bio-fuels debate and its ability to deliver a real alternative to fossil fuels. It is Maxol's belief that bio-fuels will not lead to a complete solution but are an important component in reducing consumer dependence on oil.

Today the Irish government is managing a very different economy and clearly needs to reduce public expenditure along with raising taxes to off set Ireland's growing borrowings. A carbon tax on fuel has been planned to be introduced in the December 2009 budget and it is unlikely that the derogation on bio-fuels will be maintained post 2010.

Reflecting on the new challenges for bio-fuels, Tom Noonan, says: "From the outset the move towards ethanol use has had a positive influence in helping Ireland meet EU targets. It is a win for consumers who benefit from lower emission fuel at no extra cost; a win for agriculture, which can now develop interests in ethanol production; and a win for the economy in that it could potentially reduce our imports. Although 5% may seem at first to be a small percentage, when applied to every litre of petrol that Maxol sells through its 122 service stations in the Republic of Ireland, this adds up to a very significant amount of locally produced, renewable and carbon neutral fuel. Renewable fuels are an essential part of our future and our children's future and Maxol is keen to develop initiatives in this area to help our environment."

In Northern Ireland, Maxol has replaced its regular diesel fuel with a new more environmentally friendly bio-fuel called B5. It can be used in standard diesel powered vehicles without risk to the car manufacturer's warranty or performance of the vehicle. This fuel, which is a blend of regular mineral diesel and up to 5% bio-diesel, was introduced throughout Maxol's entire Northern Ireland network of approximately 92 service stations during 2008. The move is further evidence of Maxol's commitment to renewable fuels and towards helping the UK government meet its renewable transport fuel obligation (RTFO), which requires that by 2010, 5% of all road vehicle fuel be supplied from sustainable renewable sources.

Brian Donaldson says: "This is a further indication of Maxol's commitment to cleaner fuels and more environmentally friendly motoring for the Northern Ireland driver."
Retail Awards Scheme Quality has always been high on the agenda at Maxol and the company has always sought to recognise and reward its service stations that continue to excel. Over the years Maxol has handed out numerous awards, all aimed at recognising its excellence within its retail network. One such success story is the Brennan family, who run a Maxol service station in Co. Kildare and were presented with the award for ‘Top All-Ireland Retailer' in 2009.

The Brennans are no strangers to success in Maxol's Awards and in 2007 also won the company's ‘All-Ireland Staff Team' Award. This success hasn't been limited to just one award and they also won two further awards: 'Top Customer Care Retailer', 'All Ireland Staff Team of the Year for a dealer-owned site'.

Commenting on the Brennans success, Maxol's retail area manager, Mark Walsh, who is responsible for the area, says: "This is a really great achievement and one of which they can be extremely proud. The scheme was originally developed in 1992 to ensure that customers can expect the best from Maxol, including quality retailing and premium customer care and that the best levels of service and amenities are maintained on Maxol forecourts. This award along with their other wins acknowledges their commitment to achieving this goal."

Maxol is focussing much attention towards motivating and driving enhanced standards of cleanliness and presentation on the forecourt and in-store by running a 12 month incentive scheme for all sales staff on company and independently owned Maxol service stations. The company regularly carries out site inspections and mystery shopper visits to measure performance and identify areas for improvement.

This healthy mix of investment, innovation, marketing and expertise has lead to Maxol maintaining its position as market leader within the often turbulent petrol retailing industry on the island of Ireland, and with the company celebrating its 90th birthday in 2010 it's a mix that will see the company continuing to go from strength to strength.